TransAlta Corp. and MidAmerican Energy Holdings Co. are partnering to develop natural gas-fueled power generation projects in Canada.

“Studies are showing that more than $200 billion worth of new investment in power generation is needed in Canada over the next 20 years,” said TransAlta CEO Dawn Farrell. “MidAmerican is a strong partner to enable us to capture a sizeable share of that market opportunity, and this project will build off our already existing business relationship, which dates back to 2001.”

The agreement encompasses all new natural gas-fueled generation opportunities considered by either TransAlta or MidAmerican in Canada, including TransAlta’s proposed Sundance 7 project, an up to 800 MW project based in Alberta. All development and construction or acquisition of approved projects will be funded on a 50-50 basis, and TransAlta will be responsible for construction management, operation and maintenance of the projects that proceed.

“At MidAmerican, we have been seeking an entry point to the Canadian electricity generation market, where we see strong potential for growth,” said MidAmerican CEO Greg Abel.

In Canada the reduced greenhouse-gas emissions of gas-fired stations set the standard for power generation under clean air rules announced by the federal environment department in mid-2010. The national standard requires all operating coal plants to shut down once they reach 45 years of age or at the end of power purchase agreements if the contracts with participants in deregulated provincial markets run past the birthdays. The rules prohibit the owners of coal plants from making investments to extend the sites’ lives unless their carbon emissions can be about cut in half to the level of cleaner gas-burning operations.

Over the coming decade Alberta’s Energy Resources Conservation Board expects that gas-fired cogeneration capacity in the province will climb to 8,500 MW, or half the anticipated total provincial electricity supply of 17,000 MW as of 2012. The projected new level of gas-fired generation will exceed the current total capacity of about 5,600 MW at coal-burning plants (see Daily GPI, July 9).

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